Sanofi and Boehringer in talks over asset swap
French company Sanofi and German drugmaker Boehringer Ingelheim have entered exclusive negotiations to swap businesses. This move would turn the French company into a major force in consumer healthcare while Boehringer would become the second largest company in animal health.
The proposed transaction would consist of an exchange of Sanofi animal health business with an enterprise value of €11.4 billion and Boehringer Ingelheim consumer healthcare (CHC) business with an enterprise value of €6.7 billion. Boehringer Ingelheim CHC business in China would be excluded from the transaction. The transaction would also include a gross cash payment from Boehringer Ingelheim to Sanofi of €4.7 billion.
Sanofi shares rose as much as 4.8% on the news and lately were up 4.4% to €78.01.
The addition of the Boehringer consumer business would improve Sanofi’s presence in Germany and Japan in particular while it would also give it “critical mass” in products for coughs and colds. The deal would also help swell Sanofi’s business in the US, Europe, Latin America and Eurasia, the French company said.
By taking on Sanofi’s animal health business – which is called Merial – Boehringer said it would become the second largest player in global animal health with sales of around €3.8bn.
Olivier Brandicourt, chief executive of Sanofi, said: “In entering into exclusive negotiations with Boehringer Ingelheim, we have acted swiftly to meet one of the key strategic objectives of our roadmap 2020, namely to build competitive positions in areas where we can achieve leadership. This transaction would allow Sanofi to become a world leader in the attractive non-prescription medicines market and would bring a complementary portfolio with highly recognized brands, allowing for mid and long term value creation.”
Andreas Barner, chairman of Boehringer Ingelheim commented: “Boehringer Ingelheim Animal Health is and will stay strongly committed to bringing novel, innovation driven solutions to veterinarians and animal owners. Our combined Animal Health business would be well positioned for growth and emergence as a leader globally. I am confident that Sanofi will enable our consumer healthcare business to fully live its potential supported by highly professional and committed teams.”
The Boehringer Ingelheim group is one of the world’s 20 leading pharmaceutical companies. Headquartered in Ingelheim, Germany, Boehringer Ingelheim operates globally with 146 affiliates and a total of more than 47,700 employees.
Sanofi, a global healthcare leader, discovers, develops and distributes therapeutic solutions focused on patients’ needs. Sanofi has core strengths in diabetes solutions, human vaccines, innovative drugs, consumer healthcare, emerging markets, animal health and Genzyme.
